Yes, Uber has lost ridership to Lyft during crisis that lead to CEO’s resignation

Uber’s discrimination investigation recommends dozens of reforms within their company walls.USA TODAY

A sign marks a pick-up point for the Uber car service at LaGuardia Airport in New York on March 15, 2017. Travis Kalanick, the combative and embattled CEO of ride-hailing giant Uber, resigned June 20, 2017 under pressure from investors at a pivotal time for the company.(Photo: Seth Wenig, AP)

SAN FRANCISCO — In the tumultuous months leading up to Uber CEO and co-founder Travis Kalanick’s resignation, the ride-hailing company lost U.S. market share and saw its brand image tarnished, most notably by a former engineer’s blog post blasting the ride-hailing company for its sexist work environment.

Among several surveys tracking the company’s decline: one based on credit card spending, which found over the past two years, Uber’s share of rides has dropped to 75% from 90%, according to TXN Solutions. The last 3 point slip — to 75.3% from 78.8% —happened between Susan Fowler’s mid-February blog post and the first week in June, according to the data compiled for USA TODAY by TXN, which creates sales estimates based on credit card receipts.

Ride-hailing rival Lyft saw its market share rise to 24.7% from 21.2% during this period, as Uber was hit by an unrelenting stream of revelations about the company’s business practices and workplace culture, from its use of a fake version of its app to dupe municipal regulators to more recently, a senior executive’s sharing of medical records of an Uber driver’s rape victim.

These incidents snowballed into a crisis, which resulted in Kalanick’s resignation late Tuesday night. He stepped down after receiving a letter from investors seeking his resignation, first reported by The New York Times. “I love Uber more than anything in the world and at this difficult moment in my personal life I have accepted the investors request to step aside so that Uber can go back to building rather than be distracted with another fight,” Kalanick said in a statement, confirmed as accurate to USA TODAY by Uber.

Kalanick had taken a leave of absence June 13, in part to grieve over the recent death of his mother in a boating accident. That same day the company got the results of an internal investigation led by former U.S. Attorney General Eric Holder. Its findings suggest Uber needs a broad overhaul of its board and management, including the addition of independent members to its board and tying cultural improvements to manager compensation.

Uber did not respond to a request for comment on TXN’s data. In late May, the company confirmed a Wall Street Journal report indicating the privately-held company’s business was improving at the start of the year, despite a string of public black eyes. The start-up, which has been valued at around $70 billion, narrowed its quarterly losses to $708 million in the first quarter from $991 million in the fourth quarter of 2016.

But Uber has faced backlash since January, when controversial pricing during protests over the Trump Administration’s attempted travel ban sparked a #deleteuber campaign. Rival Lyft has seen market share gains over the period, and it’s rapidly expanding its presence in U.S. cities.

Consumers’ view of Uber dropped during the tumultuous times, according to two other separate surveys. Management consultancy cg42 found that 80% of Uber customers are aware of Uber’s recent scandals and those with negative views of the company have jumped to 27% from 9% since the news began to tarnish the company’s reputation.

“26% of Uber’s customers claim they are actively exploring alternatives and will use Uber less frequently, but only 4% have actually made the decision to switch services as a result of the negative news,” the cg42 report says. “This is a low switch rate, specially when considering barriers to doing so are low.”

But the impact is real in terms of the company’s ability to attract new customers. Prior to the scandal, the reports says, 13% of prospective Uber users “were very or extremely unlikely to consider doing business with the ride-haling service (but) post-news, 32% say they would not do business with Uber.”

The bad image problem also surfaced in a Morning Consult Brand Intelligence survey, which showed that just 40% of U.S. adults have a favorable impression of the company, the lowest data point for that statistic since Morning Consult began tracking it in October 2016.

Moreover, that favorability rating fell 9 percentage points during the week of June 12, a period in which Uber laid off 20 employees related to its investigations into workplace discrimination and pushed out a high-ranking executive, Emil Michael.

Ride-hailing drivers, too, were more satisfied working for Lyft, another survey found. More than three-fourths of 1,150 drivers (75.8%) surveyed in January by The Rideshare Guy blog agreed strongly or somewhat they were satisfied driving for Lyft, compared to 49.4% for Uber.

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Uber CEO Travis Kalanick has resigned. His successor will have to manage a myriad of troubles for the company. USA TODAY

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Uber co-founder Travis Kalanick stepped down as chief executive of the ride-hailing service, following intense pressure from investors, a company spokesman said on Wednesday. Time

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His comments were made during a meeting focused on diversity and moving on from the company’s troubled past.
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Uber’s discrimination investigation recommends dozens of reforms within their company walls. USA TODAY

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The chamber, along with Uber and Lyft, welcomed the ruling. USA TODAY

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Uber has been involved in a long list of scandals recently that have made the future of the ride service uncertain. There had been rumors that Uber founder and CEO Travis Kalanick was expected to step down amid all of the controversy, but it looks like he’s sticking around. USA TODAY

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The president of the embattled ride-hailing company Uber has resigned just six months after taking the job. Jeff Jones’ departure is the latest challenge facing the technology giant as CEO Travis Kalanick prepares to take Uber public. (March 20) AP

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The complaint said that Uber and Otto, acquired by the ride services company in August, stole confidential information on Waymo’s lidar sensor technology. USA TODAY

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Uber is under fire again. This time, a former employee says she was sexually harassed and the company let it happen. Aaron Dickens reports. Buzz60

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